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For as long as there has been money, there has been some form of money laundering. Essentially, money laundering is the process whereby “dirty” money (i.e. money that should be going to someone or somewhere else) is actually hidden elsewhere, sometimes in investments or other places so that it cannot be found. Over 4,000 years ago, Chinese merchants would hide their money from their rulers by investing it in businesses elsewhere.
In modern times, the concept of money laundering has essentially remained the same, but the mechanics of the process have become much more complex as global economies have become intertwined.
What is money laundering?
The process begins with money that is the result of illegal profits. This could range from the sale of counterfeit goods to drugs to illegal guns to illegal gambling. In order to be able to use a bank to process the money (since banks are prohibited from taking illegal money), the money is shuffled around to various accounts before being filtered (or “laundered”) through legitimate businesses such as casinos, strip clubs, real estate, and even life insurance policies.
The accounting sleight of hand that must take place to filter the money is impressive, as is the sheer number of different ways in which the money can actually be laundered. Options may include structuring (aka smurfing) whereby the large amount of money is broken down into smaller deposits so as not to attract suspicion, trade-based laundering involving inflating invoices to hide the money being transferred from one party to another, and perhaps one of the more aggressive moves: bank capture whereby the launderers simply buy the bank or at least a controlling stake and take advantage of any lax laundering laws in the jurisdiction.
The laws controlling money laundering
As with most federal laws dealing with money, the number of different crimes being perpetuated under the money laundering umbrella has grown. In some jurisdictions, laundering includes just abuse of the financial system. In the U.S., the 9/11 attacks prompted a look at terrorism funding, which spawned the Patriot Act requirements to further combat international money laundering being used to fund terrorism.
While Florida has a money laundering statute, an individual who is charged with money laundering will more likely find themselves in federal court. This is particularly true for members of large crime syndicates who operate multistate or multinational money laundering operations. Federal money laundering prosecutions go after not only the individuals, but the money as well, which was one method used to combat the war on drugs in the 1980s. Surprisingly, money laundering itself was not actually a federal crime until 1986. Individuals who are convicted can face up to 20 years in jail, and of course, there will be asset forfeiture.
If you have questions about money laundering or are perhaps the target of a money laundering investigation, the attorneys at Weisberg Kainen Mark are ready and able to answer your questions or help you navigate through the process. Contact us today to get started.
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